A record number of rentals and dwindling demand have brought good news for renters with median prices expected to continue to ease.
According to Trade Me's latest Rental Price Index for May, rental prices dropped for the first time this year, with the national median weekly rent falling one percent to $575 when compared to April.
"This marks the first month-on-month drop we have seen this year, and is $5 less than the all-time high national median weekly rent last recorded in April," Trade Me Property sales director Gavin Lloyd said.
With more options than ever and prices slightly easing, Lloyd said it is a great time to be looking for a rental property.
"Over the past couple of years we have seen unparalleled price growth and consistently low supply, so last month's changes will be music to the ears of Kiwi renters."
However, looking back at last year, May's median weekly rent has increased by seven percent when compared to May 2021.
The biggest year-on-year jumps were seen in Taranaki (up 16 percent) and Northland and Southland (both up 11 percent).
Auckland
The Auckland region's medium weekly rent was above the national level at $600, a two percent increase from the same month last year.
"When compared with the region's record-high median weekly rent first recorded in January, this marked a slight drop of $10 per week," Lloyd said.
He said the most expensive districts in May were Papakura ($650) and North Shore City ($640).
Lloyd said the most popular listing in the Auckland region in May was a three-bedroom home on Haverstock Road in Sandringham for $520 a week, which had 379 watchlists in its first week on the site.
Wellington
In the Wellington region, the median weekly rent rose three percent year-on-year to $615 in May.
However, when compared with April this year, Wellington prices dropped two percent.
The highest median weekly rent in the region was seen in Porirua ($650), followed by Wellington City, ($620) and Kapiti Coast ($610).
Last month's most popular listing in the Wellington region was a three-bedroom house on Wallace Street, Mount Cook. The $588-a-week property was watchlisted 194 times in its first seven days onsite.
Supply and demand
Lloyd said the number of rental listings across the country in May marked a 12 percent increase when compared with the same month in 2021.
"The spike was really carried by the main centres, with both the Auckland and Wellington regions seeing remarkable supply increases last month," Lloyd said.
The Wellington region saw the largest increase, with supply jumping a huge 45 percent compared with May 2021, reaching an all-time high.
Lloyd said Auckland also saw a record number of rental listings, up 16 percent when compared with the same month last year.
Marlborough was the only other region to see more rentals than ever before, up 24 percent year-on-year in May.
Trade Me found nationwide demand for rentals fell eight percent year-on-year in May, with the biggest drops seen in the Nelson/Tasman region which was down 28 percent.
Northland and Taranaki were the second-biggest declines, both down 19 percent.
While Canterbury (up 21 percent) and Southland (up eight percent) where the only regions to see increases in demand.
"This mirrors what we saw in the property for sale market in May, with nationwide supply up 48 percent year-on-year, while buyer demand dropped by nine percent," Lloyd said.
Looking ahead, Lloyd said the market may ease for renters in the coming months.
"The combination of increasing supply and dropping demand is going to be interesting going into the next few months. If this continues, we may well see prices tumble as landlords look to fill their rentals in a less competitive market."
